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Interview: Zappos Head of Customer Loyalty Team Provides Insight to Delivering Happiness

By Annie George

Posted on 09 Aug 2011

About two months ago, I read Delivering Happiness: A Path to Profits, Passion, and Purpose by Tony Hsieh, CEO of Zappos.com, the largest online shoe retailer which was acquired by Amazon for over $1.2 billion back in 2009. If you haven’t yet read this New York Times best seller, pick it up or download it. And be sure to share it with each of your customer service reps. It’s inspiring, insightful, funny, and really gets you thinking about how when you love what you do, you can create something very special for not only yourself and your employees but also for your customers.

Zappos is headquartered in the Las Vegas metropolitan area of Henderson. The company has 1,300 employees at its headquarters and another 1,500 at its fulfillment center in Kentucky. Zappos’ success is based on a loyalty business model and relationship marketing. It puts tremendous emphasis on its company culture and core values, which Tony speaks about at length in his book. His belief is that "if we get the culture right, then everything else, including the customer service, will fall into place.”

I wanted to speak with someone who is an integral part of Zappos to find out how they make “delivering happiness” work. I spoke with Maura Sullivan, Senior Manager, Customer Loyalty Team (CLT), who has been with Zappos since 2003 when they were based in San Francisco, and later moved to Las Vegas seven years ago when the company changed headquarters. Like many of her colleagues at the time, she was in her twenties, was skeptical about leaving her home base, but decided to take a chance. That chance has resulted in a “wild, exciting ride, filled with tremendous growth and a lot of change.” She’s looking forward to seeing what the next eight years will bring at Zappos.

Annie George (AG): Maura, your division is called Customer Loyalty Team (CLT). What is the genesis of the name?

Maura Sullivan (MS): “It’s our call center or what another company would call customer service. We knew that we wanted to be a little bit different and ‘customer service’ had such a bad connotation to it, and still sometimes does. If you need customer service, most likely you have a problem and feel as though you’re going to have to fight to get the issue resolved. We also wanted to focus on the fact that we’re not a sales team, we’re not selling anything. We are providing service and creating loyalty from our customers so they want to come back. Customers are mainly calling in to ask about returns, a product delivery, or information about the product itself. They will occasionally place orders with us over the phone, but 95% of the sales take place online. Our CLT is all about helping the customers out.”

AG: How does a company like Zappos, as it continues to get bigger, continually deliver on what it says and in what it believes?

MS: “One of the most important things for us is who we hire. When we first moved to Las Vegas, we needed people, especially for the call center. We used a temp agency, but after about year, we realized that we had to do the hiring ourselves, to have individuals that fit into our culture. So we set up our core values to define our culture. We knew all along that we had this great culture and that we did things a bit different, especially in the call center and in the service world. But having our values as a reference and in writing, and the fact that everyone at the company at that time had a say in what our core values were, was huge for us. We look to our core values as our compass in hiring, to affect change, in our all decisions. Who we hire is important, and while we can teach them part of our core values, we want people who come to us with those core values fundamentally already there.”

AG: What do you look for when you’re hiring someone?

MS: “Since we’re looking for individuals who are more of a culture-fit than technically-fit, the hiring process is a bit more challenging. We look at someone’s personality. Our application includes questions based on our ten core values. For example, we ask, ‘From a scale of 1 to 10, how weird do you think you are?’ We’re not looking necessarily at the answer that’s given, but whether the person is having fun during the interview…if that person can give a creative answer. If you’re a one on the scale, then Zappos may not be the place for you. We don’t have an overly structured environment, so if you need to read from a script when dealing with customers, or you have set expectations of your work environment, then this won’t be a good fit for you. What’s more, in our call center, we aren’t necessarily looking for people who have experience. In fact, we prefer you don’t have experience as we do things so differently here.”

Maura also explained that in addition to hiring the right people, being friendly and helpful on the phone and empowering your reps to offer resolutions goes a long way.

“Many people when they call in aren’t familiar with Zappos. Based on their experience in dealing with customer service in general, they’re instinctively worried that this isn’t going to be pleasant and their defenses are up. If we can immediately remove that fear and let them know that we’re going to help no matter what it takes, we’ve gained their trust.

“Our CLT reps are completely empowered to help customers and don’t need to defer to a team leader or supervisor. There are no scripts to follow, a customer doesn’t want to hear excuses or that this is outside the company policy. We have policies but we’re extremely flexible with them. A rep can make the decision to help anybody. If, for example, someone calls in and has had a pair of shoes for 6 months and the heel came off, the rep is empowered to send a new pair of shoes or credit her account.

“It’s about proper hiring, training, and empowering our reps to do what’s right for the customer. The reps are the ones talking to them, they know the situation so they should be able to resolve the situation.”

AG: How do you continually “wow” your customers? Is it an ongoing process you evaluate as a company to see where you can continually make a difference in providing the very best customer experience?

MS: “We have focus groups with our team members to discuss what ideas they have to improve a customer’s experience. We also have leadership team meetings. But for the most part, it’s an organic process based on ideas that come from our team members, the people answering the phone every day. For example, I just got a great email from a customer saying that he was so surprised at how much he related to the rep. The rep knew that the customer was watching some sporting event, went online and looked up the score to talk to the customer about it. It’s little things like this that change the transaction into an actual experience or a relationship. We share these things and try to see what else we can do.

“One of things we do is send flowers to customers. Our reps are empowered to send flowers if they have a good interaction with a customer or learn that an event like a birthday or wedding is coming up. We decided last year to change things up a bit…to also provide the option of sending Mrs. Fields cookies to customers. We’re always looking to reinvent and keep things new.”

AG: How do you prevent frustration from arising and minimize burn out?

MS: “We create an environment in our call center whereby during most of the year the reps are not just on the phone eight hours a day, day-in and day-out. We’ve built many components into our hiring plan and schedule to allow for time off the phone. We have training classes, team-building, and opportunities for reps to learn different skills sets so that they can apply for other teams (Live Chat, email) within the call center. That allows them to diversify and to receive an increase in pay as well. We offer a lot of variety in their day.

“In December, everyone is on the phone all day, as this is the busiest time for us. But we set those expectations from the beginning and talk about the holidays year-round. It’s our time to be ready and shine. But we’re all human and there are times when you want to vent about a customer or situation. We encourage people to take the time to let it out – go into the conference room or out on the balcony, take a walk to regroup. We also have a nap room people can use during a break, especially important for those who work the 4:00 am shift. Having those outlets is very important and having an environment to be creative and de-stress is as equally as important.”

AG: Do you hold regular meetings to recharge the group?

MS: “Every week a team has a Team Zuddle [Zappos Huddle]. It’s about a 15- to 20-minute break for reps to meet with their team. Each month we also have a one- to two-hour team-building meeting with a budget for this. And at the beginning of each year, we close down the call center for a few hours and hold a Customer Loyalty All-Hands Meeting. We usually rent out a room at one of the casinos and have a big kick-off meeting to discuss goals and plans for the year, followed by happy hour. We also have quarterly all-company meetings.”

AG: Does the CLT have a high retention rate? What is the demographics of the people you hire?

MS: “We have an annualized attrition rate in the call center of about 20%. Some of this includes people moving out of Las Vegas, and some of it is due to non-performance. But it also includes people moving from the call center to other departments within Zappos like merchandizing or training. We have a great deal of opportunity for growth here. I started out on the phones. In fact everyone in a leadership position in the call center began on the phones, and as we continue to grow we’re going to need more leaders. There are also 90-day internship programs in other departments in which people can participate. If an opportunity opens, they’ll get hired.

“The average age of the company is thirty-four. In the call center, the age range runs the gamut – from people who have just graduated high school to individuals coming out of retirement and returning back to work because of the recession. It’s great to see all the different generations mix and mingle. They may not have a lot in common, but what they do have in common is our core values and that passion for Zappos and customer service. It’s fantastic to see the 70-year-old grandmother sitting next to the kid with the tattoos, jet-black hair, and piercing and then going out to lunch together.”

AG: One last thing. If we were sitting around having a beer and I asked you what your job at Zappos was like, what would say?

MS: “I get to work with great inspiring people every day and have a blast doing it.”

Whether you’re a small agency or a large brokerage or insurance company, get hold of Delivering Happiness. You’ll go on the journey of company struggling to make payroll and expenses to selling over $1 billion in gross merchandise in less than 10 years. Most of all, you’ll see how putting the “wow” in delivering a better customer experience brings loyalty and success.